NEW YORK (TheStreet) -- Netflix (NFLX) - Get Report shares are up 1.67% to $113.42 on Friday after CEO Reed Hastings commented on what steps the company will take to maintain its leadership in streaming, MarketWatch reports.
"We've been really growing in our approach to original content," Hastings stated.
As the company faces competition from rival Time Warner's (TWX) HBO, which recently launched its own streaming service HBO Now, Netflix plans on stepping up its game by producing more content.
Despite the fact that Netflix's revenue relies on the $7.99 monthly fee, the company continues to lead the streaming industry with about 65 million subscribers worldwide who are streaming 100 million hours of content every day, MarketWatch noted.
Separately, TheStreet Ratings team rates NETFLIX INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate NETFLIX INC (NFLX) a HOLD. The primary factors that have impacted our rating are mixed, some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- NFLX's revenue growth trails the industry average of 34.1%. Since the same quarter one year prior, revenues rose by 22.7%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The gross profit margin for NETFLIX INC is currently very high, coming in at 84.02%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 1.60% is above that of the industry average.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Internet & Catalog Retail industry and the overall market, NETFLIX INC's return on equity is below that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: NFLX Ratings Report